Early Edition August 29 2008 at 04:43 AM Chi-Chu Tschang and Harry Maurer
Obama Launches Drive to Sell His Economic Plan
Barak Obama formally accepted the Democratic presidential nomination with a drive to convince American voters that he can deliver solutions to the economic woes. "Unlike John McCain, I will stop giving tax breaks to corporations that ship our jobs overseas, and I will start giving them to companies that create good jobs right here in America," Obama said.
With the convention behind him, Obama has to confront some unpleasant realities. He hasn't capitalized on the economy's distress to build a sweet electoral lead. At the moment voters rank Obama and Republican rival McCain equally on their ability to address the economy's troubles.
Source: BusinessWeek
Rules May Loosen on Private Equity Investment in Banks
Regulators may relax rules that have deterred private equity firms from investing in banks and thrifts. An unnamed lawyer who has spoken with regulator on the matter said the U.S. Federal Reserve could clarify rules governing minority investments of less than 25% as early as next month and that could lead to more private equity stakes in banks and thrifts, and even prompt takeovers. Buyout shops are also optimistic that regulators, on a case-by-case basis, will be more open than they were even six months ago to deals involving a change of control.
Source: Reuters
Gustav Threatens U.S. Gulf Platforms
Crude oil appeared set for its biggest weekly gain in almost two months and natural gas rose as producers evacuated rigs ahead of Tropical Storm Gustav, forecast to become the worst Gulf of Mexico hurricane since Katrina. Gustav is expected to reach Louisiana next week, passing through a region home to a quarter of U.S. oil output and 14% of natural gas production.
Source: Bloomberg
Microsoft to Buy Greenfield Online
Microsoft agreed to buy online market research and surveys company Greenfield Online for about $486 million in cash. As part of this buyout, Microsoft will sell off Greenfield's online surveys division and retain its European comparison shopping services business. Greenfield collects, organizes and sells consumer opinions in the form of survey responses to marketing research firms and end users.Source: Washington Post
Bank of China Cuts Fannie-Freddie Exposure
The Bank of China has cut its portfolio of securities issued or guaranteed by Fannie Mae and Freddie Mac by a quarter since the end of June. The $4.6 billion reduction in the holdings by China's fourth-largest commercial bank is due to uncertainty over the mortgage financiers' capital positions and the timing and structure of a potential government rescue. From July 16 to August 20, foreign investors sold $14.7 billion of agency debt, trimming their overall holdings to $972 billion.
Source: Financial Times
AT&T's Rivals Exploit iPhone's Network Woes
Apple's July introduction of the iPhone 3G has been a public relations headache for AT&T, with eager buyers complaining about dropped calls and poor network connections. AT&T's rivals are happy to exploit the discontent. A Verizon executive has sent an e-mail to Wall Street analysts: "So much for a 'new' way of doing business at the old AT&T - your father's phone company."
New York Times
Headwinds for HP, Dell in Europe
Executives at Hewlett-Packard and Dell say they are starting to see their European business slip as the region exhibits the same weaknesses that have already emerged in the U.S. HP is showing signs it will weather the storm more easily. On Thursday, Dell said net income for its fiscal second quarter fell 17%.
Source: CNNMoney
Abysmal Auto Industry Imperils Delphi
Odds are growing that Delphi will be liquidated, with former parent GM taking over some U.S. plants. GM's financial obligation could grow by billions of dollars, according to people involved in the bankruptcy process. Delphi's bankruptcy financing expires at year end, and its pension plan will need a large cash infusion or need GM to take over some of it.
Source: Wall Street Journal
The Dreamliner's Cost to Boeing
Boeing presented a final offer to machinists, dropping proposals to end some retiree medical benefits and scrapping a traditional pension program-terms the International Association of Machinists had said were deal-breakers. Boeing can ill afford a work disruption in view of huge costs involved in the delay for more than a year of its new 787. By the time Boeing puts its first Dreamliner into the air this fall, the company will have racked up extra costs that may top $2 billion.
Source: BusinessWeek
Conversation of the Day: GEORGIA-RUSSIA CONFLICT
Reader Wim Roffel Writes: "It looks like Georgia will be in the world's top 10 aid receivers for a long time. To achieve that, its relations with Russia will stay bad for a long time."
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